We construct a model of the credit market where financial contracting is subject to costly state verification and moral hazard. The economy's aggregate activity and its equilibrium lending mechanism are determined jointly. We analyze how changes in the model's exogenous variables, including the...

According to <link rid="b26">Pareto (1896)</link>, the distribution of income depends on "the nature of the people comprising a society, on the organization of the latter, and, also, in part, on chance." In the model developed here the "nature of the people" is captured by attitudes toward marriage, divorce,...

In 1900 only 6% of unwed teenage females engaged in premarital sex. Now, three quarters do. The sexual revolution is studied here using an equilibrium matching model, where the costs of premarital sex fall over time due to technological improvement in contraceptives. Individuals differ in their...